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CalAmp Corp (NAS:CAMP)
Gross Margin
38.22% (As of May. 2016)

Gross Margin is calculated as gross profit divided by its revenue. CalAmp Corp's gross profit for the three months ended in May. 2016 was $34.8 Mil. CalAmp Corp's revenue for the three months ended in May. 2016 was $91.1 Mil. Therefore, CalAmp Corp's Gross Margin for the quarter that ended in May. 2016 was 38.22%.

CAMP' s Gross Margin Range Over the Past 10 Years
Min: 13.13   Max: 38.76
Current: 37.29

13.13
38.76

During the past 13 years, the highest Gross Margin of CalAmp Corp was 38.76%. The lowest was 13.13%. And the median was 30.90%.

CAMP's Gross Margin is ranked higher than
62% of the 528 Companies
in the Global Communication Equipment industry.

( Industry Median: 28.11 vs. CAMP: 37.29 )

CalAmp Corp had a gross margin of 38.22% for the quarter that ended in May. 2016 => Competition eroding margins

The 5-Year average Growth Rate of Gross Margin for CalAmp Corp was 6.60% per year.


Definition

Gross Margin is the percentage of Gross Profit out of sales or Revenue.

CalAmp Corp's Gross Margin for the fiscal year that ended in Feb. 2016 is calculated as

Gross Margin (A: Feb. 2016 )=Gross Profit (A: Feb. 2016 ) / Revenue (A: Feb. 2016 )
=103 / 280.719
=(Revenue - Cost of Goods Sold) / Revenue
=(280.719 - 177.76) / 280.719
=36.68 %

CalAmp Corp's Gross Margin for the quarter that ended in May. 2016 is calculated as

Gross Margin (Q: May. 2016 )=Gross Profit (Q: May. 2016 ) / Revenue (Q: May. 2016 )
=34.8 / 91.147
=(Revenue - Cost of Goods Sold) / Revenue
=(91.147 - 56.313) / 91.147
=38.22 %

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.


Explanation

Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.

Durable competitive advantage creates a high Gross Margin because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin

1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key

CalAmp Corp had a gross margin of 38.22% for the quarter that ended in May. 2016 => Competition eroding margins


Be Aware

If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin and Operating Margin closely helps avoid value trap situations.


Related Terms

Operating Margin, Cost of Goods Sold, Gross Profit, Revenue


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

CalAmp Corp Annual Data

Feb07Feb08Feb09Feb10Feb11Feb12Feb13Feb14Feb15Feb16
Gross Margin 22.2213.1338.7619.9725.8530.2931.5133.8834.8836.68

CalAmp Corp Quarterly Data

Feb14May14Aug14Nov14Feb15May15Aug15Nov15Feb16May16
Gross Margin 34.4534.2834.6234.9635.5335.9636.2535.5938.9238.22
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